Although YHS Company has launched new exciting flavours and new beverages in 2004, its product lines and depth are still less than F&N Company. Table 3 shows that F&N Company has variety of brands products.
According to table 1, F&N Company undertakes many marketing activities which obtain sales promotions, advertising, events and experiences, direct marketing and public relations. The marketing communications that undertook by YHS Company are less that F&N Company. YHS Company engaged in promotions for its Justea brand products during the festive seasons but not for other seasons (Global Market Information Database 2006). This is the weakness of YHS Company. The television advertisements of F&N Company are more attractive than the advertisements of YHS Company which are almost the same every year.
Table 2: Yeo Hiap Seng Company Product Mix
Sources: (1) Yeo Hiap Seng Company website 2004.
(2) Global Market Information Database 2006.*
Table 3: F&N Company Product Mix
Sources: (1) F&N Company Website 2005,
(2) Fun Flavours #
(3) 100 Plus Flavours*
Tables above show YHS Company has a product-mix width of three lines which is Fizzi, Justea and Yeo’s. However, F&N Company has a product-mix width of seven lines. It shows that F&N Company has varied product lines as compared with YHS Company. In table above, it also shows that the length of the product mix of YHS Company has nineteen items. F&N Company has varied product-mix length as compared with YHS Company. YHS Company has Justea Green Tea product which comes to two flavours of lemon and peach. F&N Company also has Fruit Tree drinks which comes to mango and calamansi flavours. The Product lines of both YHS and F&N Company are consistent as they are selling consumer goods that go through the same distribution channels.
4.3 Opportunities
YHS Company focuses on producing healthy drinks. Both of the brands which are Yeo’s and Justea are healthy drinks. According to Global Market Information Database (2006), Malaysian consumers are beginning to be aware of creating healthier and happier lifestyles for themselves. Furthermore, “progressive amplification of research and development (R&D) activities will be one of the key areas that are looked into under the provisions of the Ninth Malaysia Plan for the Health Ministry” (Pang, 2006). The purpose is to form the basis of future health programs to promote a healthier Malaysia (Pang, 2006). YHS Company should take this opportunity to promote its brand to the consumers.
YHS Company focuses on producing healthy drinks whereas its competitor F&N Company focuses on producing unhealthy drinks such as coca-cola and Sarsi. According to The Star newspaper, Kapoor (2006) stated that “various cola brands continue to be toxic and hazardous to health.” This is an opportunity for YHS Company because the demand for coca-cola will be affected because of this news. Consumers will therefore pay attention to healthy drinks if they want to buy soft drinks. YHS Company can take this opportunity to undertake more marketing activities such as sales promotion and advertising to promote its products.
4.4 THREAT
4.4.1 Competitions
YHS Company did not do well in soft drinks industry is because there are many competitors in the industry. There are many direct and indirect competitors for the YHS Company in the soft drinks market at Malaysia. The direct competitors are F&N Coca-Cola Company, Permanis Sdn Bhd, and Ace Canning Corp Sdn Bhd. The indirect competitors are Malaysia Milk Sdn Bhd, Nestle (M) Bhd and Dutch Lady Milk Industries Bhd. Therefore, this will influence the sales for YHS Company. The consumers have more choices to choose the soft drinks products. The product mix of YHS Company only got 3 product lines (Table 2) while F&N Company got 7(Table 3). YHS Company marketing communications have less compare to F&N Company (Appendix 1). Therefore the market share for YHS Company will also decrease (Appendix 2).
In conclusion, the product-mix and marketing communications are the areas which the YHS Company should more considered in order to compete with order competitors. More products lines and advertising will make the sales and revenue in the company will increase because more customers purchased their products.
5.0 Why Product Mix is Critical?
5.2 Product Mix and product lines
In the soft drinks industry, F&N Company has seven product lines of product mix in Malaysia. F&N Company is very successful in the soft drinks industry. According to the Global Market Information Database (2006), F&N Coca-Cola Sdn Bhd has the highest company shares of the soft drinks sold, while Yeo Hiap Seng (M) Bhd is located on the third place (Global Market Information Database 2006). F&N Company has more product lines which are Coca-Cola, Sprite, Season, Sarsi, Fruit Tree, 100 Plus and F&N products (Table 3), while YHS Company only has three products lines which are Yeo’s, Fizzi and Justea (Table 2).
The product mix also represents a strong or good opportunity for future growth. YHS Company can has the trend towards portability is reflected by the huge sales of carbonates drinks, soft drinks and Asian specialty drinks.
5.3 Branding
According to top 10 brands (cited at top 100 brands listing 2002), F&N Company is at no9 but YHS Company’s products haven’t reached the top ten brand ranking. One of the F&N Company brand- Coca-Cola is the top one brand at the top 100 brand ranking in the world (Appendix 3). Therefore, YHS Company has not produced a well known brand in Malaysia.
6.0 Why Marketing Communications is Critical?
YHS Company didn’t use marketing communication tools effectively as it advertises their products less in TV commercial as compared with F&N Company. YHS Company advertises during festive season but F&N Company advertises through TV commercial frequently such as Coca-Cola in TV commercial and Malaysia reality show as stated in the F&N annual report. Another form of advertisement which is billboard advertisement, as YHS Company advertise their Justea product in a cartoonist way. The advertisement shows a cartoon kid is holding the drink while cycling. This type of advertisement will only attract younger consumers but not for older consumers. The annual report for YHS Company (2003) stated that, the new launch product is to target younger consumers. This shows that a Justea beverage is only for younger people.
The problem in sales promotions which faced by YHS Company is because they held less sales promotions as compared with F&N Company. YHS Company held promotions for Justea brand during festive season, stated in (GMID) in year 2005. However, Company held brand promotions at five local supermarkets in Kuching and Coca-Cola singing can promotion (Appendix 1). YHS Company only give samples for promoting their product but compare to F&N, they give samples of their product during the break of fast in mosques, orphanages, petrol stations and also supermarkets (Appendix 1). It shows that F&N build a stronger image to the consumer as compared with YHS Company.
- 6.3 Events and Experiences
Beside that, YHS Company didn’t use this tool effectively because the company only held three events within two year which are, three month long campaign “Great Health, Great Taste”, Chinese New Year campaign and Brand Building events (Appendix 1). However, F&N Company held 3 events in a year (Appendix 1). YHS Company can have the chance to deliver their brand name to the publicity but it fail because of fewer events as compared with F&N Company.
Public relation is also one of the problem which faced by YHS Company as compare to F&N. YHS Company only hold few publicity events such as, sponsoring RM20,000for the nature camp, sponsored soft drinks to A1 Team Malaysia and etc (Appendix 1). But compared with F&N Company, the company holds more activities for the publicity (Appendix 1). As less sponsorships being held, the company’s image will not be known well.
7.0 Recommendations
7.1 Product-Mix:
- 7.1.1 Increase product lines and product depth
YHS Company should increase product lines and product depth by introducing new products and new flavours. This is because of the fierce competition and product life cycle. New products have to be developed to reflect changing consumer tastes and demographics. YHS Company can emphasize new flavours and healthier ingredients with existing brands. For example, YHS Company should decrease sugar added of Fizzi brand products. Vitamin can be added into Justea beverages and Yeo’s brand products to come out with new products. One of the products of Yeo’s brand which is Laichi can add in real fruit.
- 7.1.2 Producing more healthy and nutritious drinks
Product lines can be increased by producing more healthy and nutritious drinks. Nowadays, soft drinks industry is affected by consumers’ rising health awareness to produce healthy and nutritious drinks (Global Market Information Database 2006). Fruit juice and bottled water enjoyed strong growth in soft drinks industry, largely because of this reason. According to Euromonitor International estimates (Global Market Information Database 2006), the total sales forecast of bottled water will increase by 21.2% from 2005 until 2010. Therefore, YHS Company Malaysia can produce Pink Dolphin which been introduced by YHS Company in Singapore. Pink Dolphin is the soft drink which jazzes up pure distilled water with vitamins, minerals and herbs.
YHS Company should increase its brand equity. Brand elements can be chosen to build as much brand equity as possible. YHS Company can use singer or actor as a spokespeople. Popular singers or actors are easily to recognize and remember. Therefore, consumers can recall to the products easily when they saw the spokespeople. Spokespeople is a brand element which is transferable as it can be used to introduce new products in the same categories.
7.2 Marketing Communications:
YHS Company should advertise more in TV commercial but not only when there are launching new products or during festive season. Advertisements in TV commercial should be going time to time as it can build awareness among consumers. As a result, YHS Company can build their brand name in the mind of consumers after they saw the advertisement for many times. YHS Company should not only focus on younger consumer, they should also take consideration to let older consumer know about Justea beverage. For example, they should advertise their product by using celebrity and replace the cartoonist picture in billboard advertisement. As a result, drivers and other people can be attracted and recall to the product.
YHS Company should engage more promotions in different areas which are suburb area, housing area or even supermarkets. It should hold promotions to promote the entire beverages but not the new products. Consumers can be encouraged to purchase their products while having promotions. YHS Company can also take this opportunity to give samples in order to let consumers have a try and be aware to their products.
- 7.2.3 Events and Experiences
YHS Company should hold more events by using their brand names to let the audience be aware to the sponsor company. Eventually, consumers who involved in the events would have the brand name in their mind. The events which held by YHS Company must have the sufficiency of awareness and able to create a most desirable effect for the consumers or target market.
YHS Company should hold more public relations activities by sponsoring more events, as it can take the opportunity to promote their new launching product. YHS Company can build awareness towards consumer through public relation activities. It can also save cost as it only pay for the staffs who manage the events or activities rather than paying costly for advertising. Through public relation activities, YHS Company can interact with consumers and know their needs.
These are the ways of the recommendation in the marketing communication tools. YHS Company should use these tools effectively to increase their sales and build strong brand awareness.
8.0 Conclusion:
After analyzing and doing research, we can conclude that F&N is a more superior company as compared with YHS Company. Therefore, YHS Company should improve their weaknesses by doing more research and development, survey, evaluation forms to understand and reach consumers’ needs better. KYH Consultation group has emphasized in two marketing areas which are product strategies and marketing communications.
Their product strategies which are increased the product lines and depths by introduce new brands and new flavours. YHS Company also can produce more healthy and nutrition products. Brand equity can be increased by using a spokespeople.
Furthermore, YHS Company should use the four marketing communications tools effectively to increase its sales. Advertisement should be consistently presented to consumer, as they will tend to overlook or misinterpret as have a bigger picture. Moreover, advertising is the best way to hypnotize consumers as they believe every advertisement brings good value. In sales promotions, they should hold promotions to encourage consumers purchased their products. Other than that, YHS Company should use events and experiences tool to build and create very strong brand awareness to the publicity. Lastly, YHS Company should hold more public relation activities such as sponsoring more events to promote their new launching product and protect their image.
YHS Company should use these two strategies to encounter their problems in order to have higher sales and become a well-known company.
9.0 REFERENCE LIST:
ACNielsen 2003 ‘ACNielsen Reveals Malaysia’s 100 Favourite Brands for the
Second Year’ viewed 10 October 2003
<>.
A1 Team Malaysia 2006, ‘Approved Suppliers’, viewed 10 September 2006, <>.
Bursa Malaysia 2006 ‘Company Announcements’, viewed 16 August 2006,
<>
Chen, WL 2005 ‘UCSI Edu-Van Still A Hit In Schools ’, viewed 10 September 2006, <>.
Coca-Cola, n.d. ‘TV Commercials’, viewed 15 September 2006, <>.
DATAMONITOR COMPUTERWIRE 2006 ‘Drinks- Top 100 Companies’ viewed 3
September 2006,
<
>
‘Fun Flavours’, viewed 22 September 2006,
< >.
F&N Coca-Cola (M) Sdn Bhd 2005 ‘Media Room’ viewed 20 August 2006,
< >.
F&N Coca-Cola (M) Sdn Bhd 2005 ‘Our Brands’ viewed 20 August 2006,
< >.
Global Market Information Database, 2006 ‘Soft Drinks In Malaysia’, Viewed July
2006.
Kapoor, C 2006 ‘Fizzy battle between NGO, states and cola companies’, viewed 20 September 2006, <>.
Kotler, P & Keller KL 2006, ‘Marketing Management’ 12th Edition, Pearson Education
International, United Stated of America.
Lim, L 2004 “What’s New”, viewed 10 September 2006, <>.
Michael, S 2006 ‘Thrill of the outdoors for kids’, viewed 10 September 2006, <>.
Pang, HY 2006 ‘Focusing on R&D under the 9MP’, viewed 20 September 2006, <>.
The McGraw-Hill Companies 2006 ‘The 100 Top Brands’, viewed 2006,
<>
The Star Online 2006 ‘Food products to make debut’, viewed 10 September 2006, <>.
The Star Online 2006 ‘Goodie bags await kids at workshop’, viewed 10 September 2006, <>.
Yeo Hiap Seng (M) Berhad 2004 ‘Corporate Profile’, viewed 30 July 2006,
< >
Yeo Hiap Seng (M) Berhad 2004 ‘Products’, viewed 30 July 2006,
<http://www.yeos.com.my/product/index.php>
Yeo Hiap Seng Ltd 2004 ‘Bevarages’, viewed 25 September 2006,
<>.
Y3 Technologies Pte Ltd., 2001 ‘Case Study: Yeo Hiap Seng (YHS) achieves significant cost savings through logistics outsourcing’, viewed 22 September 2006,
< >.
‘100 Plus Flavours’, viewed 22 September 2006,
<>
10.0 Appendices:
10.1 APPENDIX 1: MARKETING COMMUNICATIONS
10.2 APPENDIX 2:
Company Shares of off-trade Soft Drinks (as sold) 2001-2005
Source: Global Market Information Database.
10.3 APPENDIX 3:
Top 10 Brands at The World:
Source: The McGraw-Hill Companies 2006 ‘The 100 Top Brands’
10.4 Appendix 4:
Top 10 Brands
- #1 Dunhill (Cigarettes) British American Tobacco
- #2 Carlsberg (Beer & Stout) Carlsberg Marketing
- #3 Marlboro (Cigarettes) Philip Morris
- #4 Guiness (Beer & Stout) Guinness Anchor Berhad
- #5 Tiger (Beer & Stout) Guinness Anchor Berhad
- #6 Salem (Cigarettes) JT International
- #7 Milo (Health Food Drinks) Nestle Products
- #8 Benson & Hedges (Cigarettes)British American Tobacco
- #9 F&N (Soft Drinks) F&N Coca-Cola (Malaysia)
- #10 F&N (Sweetened Cond Milk F&N Dairies (Malaysia)
Source: ACNielsen (2002, sourced from Top 100 Brands Listing)
Appendix 6:
Position map for Yeo Hiap Seng Company, F&N Company, Permanis Company and also Ace Company.
